Don’t Buy a Franchise Unless It Has These Five Traits

Investing in a franchise is probably the largest expenditure you’ll make after the purchase of your home, so it is crucial to determine if the company has staying power. Key factors that influence a franchise’s enduring success include innovation, adaptability, market customization, customer retention and training & support.

Let’s explore what goes into each of these areas so you can better understand what to look for and know what questions to ask when researching these and similar opportunities.


Innovation: While a few industries do not need to invest heavily in research and development, most companies today have to engage in constant innovation in order to keep their brand fresh and their businesses growing. What are the franchises you are considering doing to further develop their service or product, maintain their creative edge, and stay relevant to their customer base?

“We are very aggressive when it comes to innovation,” says Auntie Anne’s Vice President, Global Marketing, Heather Neary. “We stay on top of consumer trends to ensure we are providing them with the solutions they are seeking and leverage technology on behalf of our franchisees and customers.”

The franchise brands named in our 2015 Top Franchises report scored about 12% higher than average in innovation and creativity. Perhaps more telling is that there were over 36% more occurrences of an “excellent” rating, the highest response option, by franchisees of the Top 200 Franchises, showing these systems are focused on evolving their brands in order to meet changing consumer needs and desires.

“We have always believed that if people, products and presentation are carefully managed that our franchisees will be successful. With this in mind, we started the Energy Project, which outlines best practices to create a high energy, positive customer experience in our stores,” says Jim Carpenter, Founder, and CEO of Wild Birds Unlimited. “It addresses products and presentation, as well as how to interact with customers.”


Adaptability: How will the franchise be able to weather shifts such as changes in the minimum wage, healthcare requirements or the economy that could impact your business? These hot topics should be on every system’s mind.

“We have a full-time, six-person Government Team and engage outside consultants on an as needed basis,” says Jeff Huber, President & Chief Operating Officer at Home Instead Senior Care. “Their job is to advocate for government policy and public opinion in favor of at home care for seniors.”


Market Customization: Can you customize your franchise’s offerings to your marketplace to ensure a sustainable revenue stream?

“We have some franchisees who contract with local schools, hospitals and skilled nursing facilities, while others maximize our National Account partnerships with highly-skilled nursing or workers’ compensation cases,” says Shelly Sun, CEO and Co-Founder of BrightStar Care.

“In addition to our core menu, our franchisees can elect to offer breakfast and smoothies,” says Auntie Anne’s Neary. “This has helped us extend our offerings to non-traditional locations including universities, food trucks and airports.”


Customer Retention: What will the franchise do to help you keep customers coming back? Beyond delivering a great experience, generating repeat business relies on a variety of approaches, top of which is customer rewards.

“We launched My Pretzel Perks, a mobile customer loyalty app, in August. Depending on the number of points a customer earns, they can attain one of three loyalty tiers: Pretzel Fan, Pretzel Lover or Pretzel Perfect,” says Neary.” Rewards ranging from special discounts and offers to free products are given with every 300 points earned as well as when a loyalty tier is reached.”

Almost all franchise systems today also gather and analyze customer feedback.

“Obtaining direct feedback from our customers helps us to improve business operations, correct shortcomings, and deliver excellent customer service,” says Chuck Pistor, President of Miracle Method. “We currently have 97 to 98 percent customer satisfaction.”

“It costs far more to lose a customer then to bring one back in,” says Leeward Bean, Owner of Big Frog Custom T-Shirts, which  encourages its franchisees to send clients handwritten thank you notes.


Training & Support: What training and support will the franchise provide? Strong initial and ongoing training and support programs will be crucial for your success and help ensure your franchise brand stays strong. This is highlighted by the Training & Support section of our survey being the one that showed the greatest variation between all franchises surveyed and the 200 in our 2015 Top Franchises report. The top brands were scored 13% higher by their franchisees compared to those that did not make our list.

“We have invested hundreds of thousands of dollars to develop a leadership program for our franchisees that teaches them how to work ‘on’ their business, build the right team, set goals for their business, and to live in a 90-day world with an emphasis on focusing on the most important things first in order to expedite results”, says Brightstar Care’s Sun.

“Our Franchise Business Consultant Team consists of members across the country who visit each of our franchises at least five times per year and communicate with them regularly in order to assist them with running their businesses as effectively as possible,” says Neary.

A good way to see if the franchise you are interested in scores well in these five crucial areas is to see if it shares its full franchisee satisfaction survey results at

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